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Lubbock business hopes high court will hear its plea in trademark dispute

Paddle Tramps squaring off with college Greek organizations on use of names in marketing materials

Paddle Tramps of Lubbock is waiting to see if the U.S. Supreme Court takes up a trademark case involving the business's products and advertising methods.

Paddle Tramps of Lubbock is waiting to see if the U.S. Supreme Court takes up a trademark case involving the business's products and advertising methods.

Paddle Tramps of Lubbock is waiting to see if the U.S. Supreme Court takes up a trademark case involving the business's products and advertising methods.

The owner of a longtime Lubbock business is looking toward Monday, Sept. 30, with a mix of tension and anticipation.

Kenneth Abraham, who started the Paddle Tramps wooden plaque business 52 years ago while a student at Texas Tech, may find out then if the U.S. Supreme Court will hear the case.

The high court’s nine justices will meet in the first certiorari conference of the 2013-14 term to select cases for their calendar.

And a trademark infringement dispute pitting the national headquarters of more than 30 college fraternities and sororities against Paddle Tramps is among about1,000 cases on the docket for Monday’s conference.

“We’re a little tense about it,” said Abraham of Monday’s meeting.

Four of the court’s nine justices must agree to hear the case for it to be selected for the oral argument calendar.

Abraham launched the business in 1961 while an engineering student and a fraternity pledge at Tech.

“We realized it was hard to make a paddle,” he said, adding the business started making non-hazing paddles and the wooden Greek and Roman letters that could be glued on as part of decorating them.

The souvenir paddles are gifts between a chapter’s big brothers or sisters and the younger pledges to whom the “bigs” are assigned.

The “bigs” are mentors to their assigned pledges during the chapter’s initiation and often through the pledge year and college.

In some organizations, the pledges decorates a paddle as a gift to their “big,” while in other houses, the “little” receives the gift paddle.

Paddle Tramps wants the Supreme Court to overturn a permanent injunction a federal judge issued in Dallas in 2008 barring the company from using the names or Greek letters of the plaintiff fraternities and sororities in the case in advertising and marketing materials.

“We think we have a better than average chance,” said Paddle Tramps attorney Tejinder Singh, about whether the Supreme Court was likely to take the case.

The high court receives about 8,000 petitions annually, and typically only 80 to 100 cases per year are accepted for oral argument.

Singh of the Washington, D.C., law firm of Goldstein & Russell, said he believes the case could be added to the court calendar because of the possibility of a “circuit split,” which occurs in cases where different federal appeals courts rule in different ways on substantially similar cases.

In those cases, the Supreme Court steps in to create a single law, he said.

“We think the Fifth Circuit is far afield on the subject,” Singh said.

“I’d be pretty surprised if the court takes this case. This case has malingered long enough,” said Wheat, with the firm of Stiles & Harbison of Louisville, Ky.

Wheat said his clients were satisfied after the appellate court ruled, and said he believes the case matches with doctrine established on other trademark cases.

The New Orleans-based appellate court in December agreed with the trial judge, U.S. District Judge Royal Furgeson of Dallas, who issued a permanent injunction against Paddle Tramps using the names and Greek designations of the plaintiff organizations in advertising and marketing materials after determining they had infringed on the trademarks.

The appeals court also affirmed a jury decision that the Greek organizations were not entitled to any damages because they had waited too long to enforce their claims.

The legal action began in 1990, when some Greek organizations approached Abraham about signing licensing agreements. He turned them down, along with requests that came in future years.

“Licensing wasn’t in our vocabulary,” Abraham said. “That was not something people talked about in the ’60s.”

He said some of the organizations considered it just part of the cost of manufacturing.

“We felt like it was a hidden tax on the fraternity or sorority member,” Abraham added.

But nothing happened in court until 2007, when 32 Greek organizations filed suit alleging trademark infringement and unfair competition after Paddle Tramps declined to sign licensing agreements with them. The original suit was filed in a federal court in Florida but dismissed there for lack of jurisdiction.

Paddle Tramps then filed a motion for declaratory judgment in U.S. District Court in Dallas in 2008, seeking a ruling that the business had not infringed on the Greek organizations’ trademarks.

Furgeson, now dean of the University of North Texas Dallas Law School, ruled Paddle Tramps had infringed on the trademarks, and issued his injunction. He also set the Greek organizations’ request for damages for trial.

“We can’t show you a picture of how the product is supposed to look,” said Abraham. “We can make and sell what we did before, but we can’t show you a picture. That’s kind of ludicrous and unfair to the consumer.”

Abraham’s son, Kyle, said Furgeson’s injunction “reaches into every part of the business,” from having to redesign catalogs and other materials, revamp company websites and pull samples from retail sites to comply.

Kenneth Abraham reflected on the change across the business’s history: “This is limiting our ability to merchandise the way we feel is fair and right to the consumer. We’ve been using pictures and catalogs since the early days.”

He added that the Greeks “in the first 30 years were encouraging us. They would ask if we could make something, or send catalogs.”

The weeklong jury trial on damages was held in September 2012.. The jury agreed the earliest date when the Greek houses should have been aware of Paddle Tramps’ use of their trademarks was 1968 and refused to award damages.

In addition, the jury determined that some of the organizations had previously given up their rights to sue by acquiescing to Paddle Tramps.

Jurors also rejected Greeks’ contention Paddle Tramps acted with “unclean hands” — a defense sometimes raised in suits that says the prevailing side is not entitled to relief from the court because of its own bad conduct.

In this case, the Greeks had argued the infringement — the act they believed gave rise to their “unclean hands” position — started with the founding of the company.